REASON 1: While the disruption in classes has been challenging for students and our entire community, the end goals have not changed.

“The University’s responsibility is to provide the high quality education and experience necessary to prepare students for the next step in their lives, whether that is employment or further education. This responsibility will be met.

In addition, tuition fees are not set according to the number of hours in the classroom, but for the course delivered. A refund would only be applicable if a course or a term was cancelled.”

RESPONSE:

They claim that tuition fees are not set according to the number of hours in the classroom. This is nothing short of a lie. Tuition is very deliberately chosen so as to cover the costs of offering the university experience—of which the main component is courses!

The university saved money through forgone salary payments to faculty, precisely because the number of hours was reduced, and thus salaries were not paid. Alternatively, a 100 hour course will most certainly cost more than a fifty hour course, all else equal. Course length affects costs. Costs affect tuition—which the administration loves to point out when defending their budget.

This is basic cost-accounting. While it is hard to fully account for where all tuition money goes, it is undeniable that courses (and everything associated with them) are the primary component of budgetary expenditure.

REASON 2: While the University has determined a tuition rebate is not an appropriate response to the MASU proposal, a number of financial points are worth considering. 

“The Mount Allison Students’ Union has stated the University saved $856,948 in unpaid salaries over the course of the strike.

The final costs of the strike to the University are not yet known. A number of financial issues will be settled during the binding arbitration process that both parties agreed to. These are costs the University has to anticipate and plan for.

The University also incurred extra costs in providing enhanced services to ensure a successful term for students. Services will continue to be enhanced for the remainder of the term in response to student need and demands.”

The University budget exists to serve students. If there is any money remaining in the budget, it will be used to benefit the education and experience of all students.”

RESPONSE:

I don’t care if the final costs of the strike to the University are unknown. The strike was not caused by students. We are paying customers who entered an agreement to receive a service. The customer is not responsible for the costs associated with labour action—the service provider is. Their logic here is parallel to transferring money from students’ budgets to university administration’s budget, by forcing students to shoulder the cost associated with the strike—by denying a rebate.

They also claim that some of the strike savings have gone towards enhanced services to ensure a successful term for students. First, they are dubiously vague about what these are, and often inflate their significance—I will elaborate more on this in the next section. Second, I hazard to guess that these additional services are utilized by only a fraction of the university population.

Third, I highly doubt the cost of such services is even remotely close the amount of unpaid salaries during the strike.

Fourth, they say the University budget exists to serve the students. This is childishly vague and misleading. The university is a non-profit organization. The purposes of the budget is to ensure that its revenues at least match its costs, in the long run.  Let’s be accurate, and not use misleading one-liners to defend a decision.

Reason 3: Offering a tuition rebate to students now would mean decreased services in the future.

“The University wants to ensure the success of our current students. That is why there have been enhancements made in the areas of academic, wellness, and financial support.

However, Mount Allison will not make a policy or financial decision that adversely affects the University’s future. Given budget realities, any rebate would eventually have to be financed by diminished student services or increased fees in the future.”

RESPONSE:

What are these enhancements?

In the academic area, they consist solely of extended hours (to my knowledge). All the other academic services, such as those provided through the Meighen center, were already in place before the strike.

In the wellness area, the only additional post-strike service is counselling hours on Saturday.

In the financial area, they have outright lied. The Financial Need bursary has always been available. No other financial support has been provided. More ironically, if they wanted to provide financial support, they would give us our tuition refund.

They conclude by saying that, given budget realities, any rebate would eventually have to be financed by diminished student services or increased fees in the future. This is a variant of the previous argument, where they insist that current students should have to burden the cost of the strike. Nowhere did I, or other students, agree to that. Nor do I consent to subsidizing future cost increases.

Final Comment

The most frustrating aspect is that students are not in a position to effectively oppose the situation. The university knows this. University education is not like shopping for jeans. If I am upset with my jean store, I can shop elsewhere. If I am upset with my university, I have no option available, except to make as much noise as possible – and I am not a very good noise-maker.

Students will be organizing weekly protests for the remainder of the semester. Other student leaders are speaking with news organizations. And finally, pressure is being placed on the Board of Regents, who is yet to confirm the decision. Any student who is similarly frustrated should consider sending a letter to the Board of Regents, and if you are so inclined, attend a protest. I hate protesting, but I think it is one of the few options we have for having our voice heard.

– See more at: http://argosy.ca/article/bagtown-economics-4#sthash.ej06jhP4.dpuf

Let’s begin with Article 4.01 of the last collective agreement between the two parties:

“The Employer retains all powers consistent with the terms of the Mount Allison University Act, 1993, as amended, to manage and operate without any limitations except those limitations which are set out in the Agreement”

This means that anything that is not explicitly specified in the contract is subject to the sole discretion of the university administration. This is an important point.

Now, consider the proposed changes to the Article 32.14 and 32.15 under the Patents subsection. The proposed additions are italicized.

32.13 The Employer waives, disclaims and abandons any interest in or claim to any invention made by an employee without the use of the Employer’s funds or its support or technical personnel or resources including its physical structures, research laboratories, capital equipment, technical facilities, or services (including the administration of funds and support received by the University for an employee in the form of grants, contracts or other support provided by the University or external sponsors).

32.14 The employee shall grant to the Employer a non-exclusive, royalty-free irrevocable, indivisible, and non–transferable right to use solely for the Employer’s internal use and programs any patented invention when such an invention has been invented with the use of the Employer’s funds or its support or technical personnel or resources including its physical structures, research laboratories, capital equipment, technical facilities, or services (including the administration of funds and support received by the University for an employee in the form of grants, contracts or other support provided by the University or external sponsors). 

The combination of these two articles implies that the university will be granted free and unlimited use of any patentable material, for internal purposes only, if the creator of that material used “extraordinary” university resources.

Thus, if a faculty member invents something using these extraordinary resources, the university is automatically granted free-use of that invention for internal purposes. The proposal by the administration, which defines extraordinary resources, redefines most of the university’s inputs as extraordinary.

But still, this doesn’t seem that unreasonable—article 32.14 only explicitly provides to the university free use of the invention for internal purposes, not a claim on revenue-sharing. However, here is the catch: Remember Article 4, which grants sole discretion to the administration for anything not explicitly stated. There is nothing in the collective agreement that explicitly disallows the university from pursuing ownership over patentable material if the creator(s) used extraordinary resources. Given that extraordinary resources now would include things like campus buildings and research equipment, the university would be able to pursue revenue-sharing over pretty much any creation on campus.

Are these potential changes wrong? Why should faculty be entitled to the full benefits of their research when the university pays roughly half their salary, and the government pays the rest?

One argument against the proposal is that researchers from other universities will not want to “play with the greedy kid on the block,” as argued by Vett Lloyd of the biology department. But truthfully, many other universities in Canada have explicit revenue sharing agreements, including the University of Toronto, McGill, the University of Victoria, Simon Fraser University, the University of Alberta, and the University of Manitoba, to name a few, as of 2010. In these agreements, the universities are entitled to anywhere from five per cent to fifty per cent of revenue, depending on the details. Given that, Mt. A  would hardly be the greedy kid on the block.

The second argument against revenue sharing is that faculty will have less incentive to innovate and research. I don’t find this to be an attractive argument either. First, they are paid to research—its part of their job. Second, their career advancement greatly depends on research output—unproductive researchers rarely get tenure. Third, in most cases at other universities, the inventor still receives at least fifty per cent of the take. And finally, I presume that faculty members actually enjoy the research they do, thus not being entirely motivated by money.

I stood with MAFA on their opposition against student evaluations, but I am much less compelled by their stance on intellectual property. Perhaps they have tabled a compromising counter-proposal, but alas I’m not privy to that information.

Let’s start with the most cynically entertaining. There is some evidence—albeit conflicting—that gender and attractiveness affect student evaluations. Specifically, that female instructors receive lower evaluation scores from male students, and that unattractive professors are evaluated more poorly, all else equal. Not all research has found similar effects, but the issue is certainly not settled. Given this, it may be awkward to use students’ evaluations in the performance review of an unattractive female professor who teaches classes to predominantly male students.

Furthermore, I imagine that professors stuck teaching a required course—say, statistics—are evaluated more poorly. It can be hard for students to separate their dislike of a topic from their perceptions of the professor’s performance.

However, for argument’s sake, let’s discount the previous two arguments—that student evaluations suffer from a number of significant biases. What about the argument that students’ are just poor judges of professor quality? While I do not fully endorse this argument, it is not unfounded. I present two pieces of evidence:

Researchers at the University of Southern California and Southern Illinois University hired and coached a confident and articulate actor to present a university-style lecture to eleven trained psychologists, physiatrists, and social work educators. The actor was presented as an expert on the application of mathematics to human behaviour, with an impressive imaginary resume. The lecture was specifically designed to include “excessive use of double-talk, neologisms, non sequiturs, and contradictory statements to be interspersed with humour and meaningless reference to unrelated topics.” At the end of the lecture, the eleven ‘students’ completed an evaluation of the actor and the content of the lecture. In comical fashion, the participants reported a high degree of satisfaction with the lecture, despite it being completely fictitious and illogical. A paid actor had duped eleven trained professionals. While Mount Allison likely never hires fraudulent professors, it is certainly plausible that a room full of eighteen-year-old students can be impressed by charismatic yet unsubstantive lectures.

The Journal of Political Economy recently published a study that followed the performance of 12,597 students over three semesters of calculus at the United States Air Force Academy. They tracked the performance of students across all three levels of calculus (1, 2, and 3), and similarly followed the student evaluations of professors for all course sections. Their results were twofold: First, high-performing students were associated with highly evaluated professors—potentially implying the students reward good teaching. But here is the concerning second finding: Students taught by a positively-evaluated professor in the original course performed worse in follow-up courses. If you studied Calculus 1 with a positively evaluated professor, you would perform more poorly (on-average) in Calculus 2. Think about that: students rewarded professors that failed to prepare them well for further coursework. This study is widely respected, and was conducted in an environment that eliminated typical statistical issues found in other comparable studies.

Student evaluations are not widely recognized as a metric and tool for professor performance, as the MASU has claimed. We ask our students “how would you describe the effectiveness of the instructor,” on a scale of one to five, yet provide no definition or guidance as to what “effective” means. Would students be content to have their performance in a course measured by one test with eighteen multiple choice questions and two open-ended questions? The real discussion should focus on how to better solicit valuable student feedback. I hope that other contributors to The Argosy will accept the challenge, and start this discussion.

– See more at: http://argosy.ca/article/bagtown-economics-3#sthash.fnZ0NrvC.dpuf

To make the point more palpable, there is evidence, here at Mount Allison, that students are less influenced by income-generation than we might originally think. The table to the right shows (1) how many degrees Mt. A granted in 2012 in each major, (2) the corresponding average starting salary, and (3) the average mid-career salary. The averages are based on a nationwide survey in the United States; there is no Canadian source that so clearly delineates salary information according to major.

First reaction: Holy classics!

Second reaction:  There is no correlation between salary and degree output. Or more accurately, there is a negative correlation. Within the majors offered at Mt. A, people seem to gravitate towards the lower-paying ones: history, English, anthropology, psychology, and sociology majors make up thirty-five per cent of the degrees granted in 2012, while the wage premiums to these degrees are relatively low.

So it appears that income-differentials matter very little in the choice of degree, at least amongst Allisonians.  And to a certain extent, this is a very sane approach: study what interests you, because that will (hopefully) lead to a job that you enjoy. We are very privileged to have the freedom to place so little weight on future income, a benefit that comes from living in one of the wealthiest nations in the world.

However, to end on a sober note, income-generation is still important. According to a Bank of Montreal survey, Canadian students expect to graduate with $26,297 of debt on average. This translates to a $319 monthly payment for ten years. Or, for the ambitious, that would be $533 monthly for five years. From this perspective, income suddenly regains some importance.

In many respects, economics is the study of mutually-beneficial exchange. It’s one in which both parties to any given transaction gain some benefit from the exchange, otherwise the trade would not take place. When the government criminalizes marijuana, it prevents a great deal of these mutually-beneficial transactions, and thus decreases overall social welfare, what economists call a ‘total surplus.’ It prevents willing buyers and sellers from coming together to engage in beneficial market transactions. And more interesting, this exact concept of ‘total surplus’ is very often used by the Canadian government to evaluate all manner of projects and policies—from highway tolls and bridge construction, and to anti-trust case tax policies. But we seem not to subject marijuana criminalization to similar reasoning.

There is another more subtle effect to prohibition. A large majority of the producers outright leave the industry, and the few who remain are given significant market power to charge prices above the marginal cost of production. The result is that, even after the total surplus is decreased, a good portion of the remaining surplus is transferred from the consumers to the producers. In the case of the illegal drug trade, this redistribution benefits the dubious and violent members of society: organized crime, for instance.

Consider the government money to be gained. At a minimum, legally-sold marijuana could be subject to provincial and federal sale tax, which is roughly thirteen cents on the dollar depending on the province. Or, we could tax it like tobacco. According to Smoking and Health Action foundation, cigarettes in New Brunswick have a total tax burden of roughly 236 per cent. If marijuana was taxed similarly, a lot of government revenue would be raised that could be used for other important government services, such as support for low-income families, or it could be used to reduce the dreaded and highly-distortionary income tax. And even with a high tax, the final price per gram would likely still be lower than what it is today.

Finally, not only would legalization bring in new government revenue, it would eliminate the funding required to enforce cannabis criminalization, and the very high cost of jailing offenders. Estimates of the enforcement costs range from $320 to $490 million; another sizeable chunk of money that could be used in more productive ways. Cannabis legalization really is an idea whose time has come. It should be justified on the basis of personal sovereignty alone, but the economic argument is equally persuasive.

The first, and often overlooked, consideration is production costs. To start, there are the authors. It takes considerable skill and time to write textbooks, especially specialized ones, and this carries a price. Secondly, there is the publisher-end, which generally includes things such as editors and copy editors, marketing, designers, text formatters, proof-readers, and so on. These can be considered the hidden costs of producing textbooks.

The second consideration is that you, the person paying, do not get to choose the book. You are told which book to buy. The purchase choice is shifted from the person that burdens the cost to some third party—the faculty—who does not shoulder the expense.  And this changes the incentives. It removes the ability of the buyer to switch between competitors, reducing the downward pressure on price. This is colloquially referred to as a ‘broken market’.

Thirdly, most publishers have some quite clever tactics to combat the growing used book market. One of these sly manoeuvres is publishing new editions. The prototypical example is that of Essential Calculus, one of the most used texts on campus. The first edition was published in 2007. Five years later, in 2012, they published a second edition. But the second edition does not contain pressing new information or innovative teaching strategies; after all, calculus has been around since the seventeenth century. It is just another way of getting students to buy a new copy, instead of a used copy of the first edition. It works because professors list the new edition in their syllabuses, and the first-year students enrolled in calculus don’t realize how terribly similar the two editions actually are. What’s more, there is evidence that textbook revision cycles are becoming shorter, likely in response to the growth of used book exchanges.

The ploy of new editions is obvious to most seasoned students. But there are other gambits used for similar purposes. Ever seen a ‘Canadian’ edition of your textbook? That helps to prevent you from selling your book online to American students. Did your book come with a ‘one-use online access code?’ Another barrier to resale. My personal favourite are ‘ready-for-binder’ texts: the idea is that the student buys the pages of the textbook and then puts those pages in a binder, instead of a traditionally-bound book, and the result is a ten percent lower price. This is not a benevolent gesture, rather a subtle barrier to resale; loose pages in a binder are more subject to damage and loss, and it is harder to resell a damaged text with missing pages.

To give an idea of how high a profit margin might be, I’ll use an example. In 2006, Barnes and Nobles was selling an economics textbook for US$127. At the same time, Blackwell’s in England was offering the same book for only US$76. The price-differential in this case is likely a good thing, allowing price to reflect the very different demand conditions in England. But the differential also demonstrates that there is tremendous room for pricing above cost.

There are undoubtedly other factors that influence the price of textbooks, but the lesson here is clear. Students’ intuition about textbooks is usually fairly reasonable: prices are high, and sometimes these aerial prices represent crafty publishing strategies and the nature of the colloquial ‘broken market,’ not just production costs.

A full year. What the hell?

Now, not all off-campus houses get snatched up in September. But if you haven’t signed a lease by Christmas, your chances of finding a nice place to live rapidly deteriorate. I have heard many stories of students literally running to houses trying to sign leases. This leads to undue stress for many, especially for first year students who do not want to live in residence the following year. Trying to contact landlords and coordinate with your new friends (with whom you aren’t yet quite sure that you want to live), all while dealing with the stress of your first year of university, would be frustrating for anyone.

So why does it happen? It’s not a shortage of housing. If there weren’t enough places for students to live, the university would not have closed the satellite houses and Bigelow House. The problem here is one that Robert Frank, a professor of economics at Cornell University, writes about in his book, The Darwin Economy:

The problem is individuals pursuing their own self-interest which leads to outcomes that aren’t beneficial for the group.

Frank’s example from the animal world is the elk. Elk fight for mates using their antlers, and on average, the bigger antlers win. So it happens that the big-antlered elk get to spread their seed more than little-antlered elk. Over time, the average antler size becomes bigger. This happens from pursuing self-interest, but bigger antlers are not good for the group as a whole. It’s harder to run through trees and away from wolves with a wider set of antlers.

The same thing happens with housing. Students recognize that of all the houses available, some are much better than others. It is in their self-interest to get that lease first, prompting them to start their housing search just a bit earlier than everyone else. We all know this, so we all have to start searching earlier, and thus begins the proverbial arms race of how early students begin looking for housing. We would all be better off as a group if we collectively agreed to wait until March before beginning the race. But there will always be someone who tries to start early. Thus, the race for student housing.